(703) 369-4738

12
Dec
2018

General Contractors Beware of New Maryland Law

by Guy R. Jeffress, Esq.

The Maryland General Assembly passed Senate Bill 853, which took effect on October 1, 2018, that added the following text to Section 3-507.2 of the Maryland Code, Labor & Employment:

In an action brought under subsection (a) of this section, a general contractor on a project for construction services is jointly and severally liable for a violation of this subtitle that is committed by a subcontractor, regardless of whether the subcontractor is in a direct contractual relationship with the general contractor.

If a court finds that a sub-contractor failed, under certain circumstances, to properly pay an employee, the general contractor may be liable for damages, counsel fees, and other costs.

The Act now permits an employee of a sub-contractor, who was not paid in accordance with applicable Maryland wage/hour laws, the right of action against the general contractor even though there is no direct contractual relationship between the general contractor and the subcontractor’s employee.

Risk mitigation strategies for Owners, General Contractors and Senior Sub-Contractors involved in Maryland based construction projects:

  1. Inspection of Payroll Records – Include in your contracts a provision that requires subcontractors to provide certified and detailed payroll information with every pay application.
  2. Audit Clauses – Include provisions in your contracts that permits you to conduct “spot audits” or “interviews” with sub-contractor employees.
  3. Certifications – Require sub-contractors to certify or declare in their payment applications that they have checked/audited the payrolls of every sub-contractor at every tier to confirm the payment of employees.
  4. Insurance/Bonding – Require subcontractors to furnish payment and/or performance bonds or wage-hour insurance. To cover the entire statutory period for wage claims, these bonds or insurance will have to be maintained for three years after final payment of wages on the project.
  5. Broad Indemnity and Personal Guaranty Provisions – In addition to any existing general indemnification clause, include a specific clause or language addressing claims arising out of any violations of the Act. Require that the principals of all sub-contractors personally guaranty compliance with the Act and payment of employees.
  6. Flow Down of Terms and Conditions – Require that all clauses in the sub-contract relating to the Act and subcontractor’s obligations thereunder flow down to each subcontract tier.
  7. Obligation to Defend – In addition to indemnification obligations there should also be provisions all sub-contracts requiring the sub-contractor to defend the general/direct contractor for violations of the Act.
  8. Hiring Decisions – Include provisions giving the general contractor the power to approve or reject the hiring of sub-subcontractors of all tiers.
  9. Site Security – Implement site security to confirm identification of all employees on the job site so no previously unidentified individuals can later appear seemingly out of nowhere and claim that an employer/subcontractor did not pay them.
  10. Creation of Fiduciary Duty – “In-Trust” Requirements – Include a provision in all private works sub-contracts requiring sub-contractors to hold all payments received “in trust” for the benefit of the direct contractor and the benefit of the subcontractor’s employees, lower-tiered subcontractor employees, for the purpose of meeting the wage and benefit obligations owed not only to the subcontractor’s employees but the employees of any lower-tiered subcontractors.
  11. Increased Retention – Increase retention percentages, withholding, and back-charges depending on the sub-contractor and size of job.
  12. Identification of General Contractor – expressly note the identity of the general contractor in each contract. Project owners may want to include disclaimers that they are “not” acting as the general contractor.
  13. Three Years Statute of Limitations – A general contractor should retain pertinent records from all subcontractors for at least that long following project completion and should make sure that all indemnification obligations survive the completion of the project for that length of time as well.

Please contact us at 703-369-4738 with any questions.

*The information contained in this website is provided for informational purposes only and should not be construed as legal advice. The material on this website may not reflect the most current legal developments. The content and interpretation of the law addressed herein is subject to revision. We disclaim all liability in respect to actions taken or not taken based on any or all the contents of this site. Do not act or refrain from acting upon this information without seeking professional legal counsel.

16
Aug
2018

7th Annual Employment Law & HR Summit

Vanderpool, Frostick, & Nishanian, P.C. together with Prince William SHRM, Inc. are pleased to invite you to attend the 7th Annual Employment Law & HR Summit. XPLORE HR: Navigating the Road Ahead

October 12, 2018 ~ 8 a.m. to 5 p.m.
Foxchase Manor, 8310 Chatsworth Drive, Manassas, VA 20109

Being informed about changes in the law on managing and paying employees is critical to your business. We encourage business owners, C-level executives, human resource and administrative personnel, managers/supervisors and in-house counsel who may benefit from education or updates on employment law issues to attend. The programing is approved for 6 HRCI (3 General/3 Business) & 6 SHRM PD Hours and is designed to be engaging and useful. A continental breakfast and lunch will be provided.

Kris Spitler, Esq. will cover hot topics in employment law focusing on recent significant court decisions, new laws and regulations, and other legal trends that your business needs to know now. She will also be participating in a presentation, along with Mindy E. Weinstein, Esq, the Acting Director EEOC Washington Field Office,  where she will discuss successfully addressing sexual discrimination risks in today’s changing cultural landscape, and reducing the potential liability for your business.

We are also pleased to announce that Christopher D. Silva, Assistant District Director, U.S. Department of Labor/Wage & Hour Division, will speak on FLSA exemptions, wage deductions, independent contractor classifications, overtime requirements, and minimum wage issues.

For additional information on the other topics, speakers, and online registration  CLICK HERE

22
May
2018

8 Corporate Strategies for Reducing Sexual Discrimination

Being a good leader of your company includes correctly identifying and addressing sexual harassment in the current culture of #MeToo and #Time’sUp.

Below are eight steps any business should consider when reviewing their sexual discrimination policies and risk management.

  1. Company leadership makes a visible commitment to addressing sexual harassment
  2. Ensure you & your entire management team understands sexual harassment and bias
  3. Have effective written policies to include:
    1. Anti-sexual harassment
    2. Anti-retaliation
  4. Training for both managers and employees
    1. Civility training
    2. Bystander training
  5. Evaluate if your company has EEOC risk factors
  6. Welcome reports of sexual harassment and then timely investigate
  7. Take appropriate actions if sexual harassment found to have occurred
  8. Determine whether your company has a gender pay gap

Some of these task can be a huge undertaking and may require competent outside counsel. The Employment Law Team of VF&N offer customizable and tailored in house staff training, presentations, handbook creation and policy review on this and various employment law topics.

*This article is designed to provide general information, is not intended to constitute legal advice and should not be utilized as a substitute for professional services in specific situations.  If legal advice or other expert assistance is required, the services of a professional should be sought.

3
May
2018

May 15th: Corporate Leadership Strategies for Combating Sexual Harassment

Join our very own Kristina Keech Spitler, Esq. and special guest, Mindy Weinstein, Acting Director of the EEOC Washington Field Office for a lively presentation for CEOs, CFOs, Presidents, Officers and other leaders in your business on: “Combating Sexual Harassment: Corporate Leadership Strategies”

Ms. Spitler and Ms. Weinstein will identify sexual discrimination risks in today’s changing cultural landscape and why being a good leader of your Company includes correctly identifying and addressing sexual harassment and discrimination in your workplace. Eight specific strategies will be provided to leaders for combating sexual discrimination and reducing the risk for your business. Open and lively discussion, questions and sharing your experiences and challenges are encouraged. The Acting Director of the EEOC Washington Field Office, Mindy Weinstein, an experienced employment attorney, Kristina Keech Spitler will address best practices. Light breakfast included. No cost, registration required.

When: May 15, 2018 8:30-10:30 a.m.

Where: Westfields Center
Greens 1 Building
15049 Conference Center Drive, Chantilly, Virginia 20151
1st Floor Auditorium

CLICK HERE TO REGISTER ONLINE

23
Nov
2016

Handbook Horror Stories

handbook-horror-stories-updated2

We invite you to join our live webinar! December 9, 2016 1:00-2:00 P.M. EST

Your company’s generic or outdated employee handbook could put your business in danger of becoming another handbook horror story!

When it comes to Employee Handbooks and each of the many policies contained in them, there are a multitude of laws, regulations, and business purposes to be considered. Many of the policies can either help you or hurt you in a matter or dispute.

We welcome you to join us in the first of our two part series on Employee Handbooks. During this webinar, our attorneys, Kris Spitler and Brendan Cassidy,  will be addressing real life legal scenarios that resulted in Handbook Horror Stories. Learn from examples of other businesses on how policies in the Employee Handbook can create problems for your business.